The Market Continues to Set Up Well

Markets got some decent follow-through yesterday to Monday's bullish technical reversal. Today the futures have been a bit volatile and now pointing to an open 5 to 8 points higher. Last night the French banks finally got their downgrade, and it created a Sell the rumor, buy the news event in the European markets for now. Obviously there is a ton going on with Sarkozy, Merkel and Papandreou holding their teleconference today. So it will create some erratic trading for sure. There are also some Buffett rumors swirling that he will also take stakes in some European banks. I will continue to monitor how the markets react to all this news and try not to have sharp opinions going into it. As of now, there is a very strong group of 20 stocks that act very well and have nice setups for higher prices. They don't seem to care about any of these headlines. The S&P 500 has reached the level of resistance I outlined yesterday and now have some room to the 1184-1187 zone. If the bears want to create a lower high, this is a spot they should take a stand. If you're long playing this bounce, this is a spot to take some profits and take a look at the landscape. This might be a spot to test some shorts as well. Above that is 1198-1204. Support is 1165-1168 and then 1157 with a major in that zone we've outlined at 1135-1140. Go-To List Apple (AAPL): I've pounded the table long on this one for years but more recently as a buying opportunity when Steve Jobs had to step down. There is now a big Macro Wedge that it will try to resolve for a move back to new highs. This stock needs heavy volume and a close above $388-$392 for it to trigger that move. AAPL can tell us a lot about the market. If it can sustain a move like that and not push through and fail, perhaps it will show us that the bulls will have more traction in coming weeks. Amazon (AMZN): This stock is a rock star, the first to go green on Monday, pointing the way to the market's reversal. It now has another pivot to overcome -- $219-$221 is the spot that could create more momentum here. Same story as AAPL: Can it break out and hold? Bearish tapes usually use breakouts as a opportunity to sell. Sina.com (SINA): Cleared its Macro Wedge yesterday and closed strong. Has room to $118-$122 if you are still long. Baidu (BIDU): Lagged a bit yesterday. Watch this today to see if it can play catch-up. A move above $145-$146 could get it moving for a move back to $150+. Google (GOOG): Very sloppy but trying to set up a lower area to use as a spot. A nice cash-flow buy can be through $532-$534. Netflix (NFLX): This one is not acting well, but I can see a move back to $220ish to test the gap and the moving averages that are curling down into it. VMware (VMW): Nice cash-flow trade yesterday through $90 and has room to $93-$95. Intel (INTC): Gave some a rare two-day move -- but now could use a rest. Microsoft (MSFT): Has a conference today. Decent setup. Hard to make money here -- ever -- but above $26.10 it has room to $27. Casinos Wynn (WYNN): True leader in the casino group, gave us a nice trade Monday and now will try and clear this new flag pattern -- $148-$151 is that area. Las Vegas Sands (LVS): Great trades lately -- has a huge high-level channel that's it's trying to bust out from. This stock should see new highs this year; we've talked numerous times about it getting frisky above $48. Agricultural Group Looks OK CF Industries (CF): Just pulled in off highs and could be worth a look around $177. Potash (POT): Sloppy and needs time. Deere (DE): Has room to the $80 area. Caterpillar (CAT): Weak lately; need to see if it can ignite though the moving averages of resistance in front of it. Retail Target (TGT): Acting better, needs to clear $52 for a big move higher. Lululemon (LULU): Absorbed the lowered guidance and still acts well. Abercrombie (ANF): Trying to clear $65 with some room to $68. LinkedIn (LNKD): Woke up yesterday and guys made money there -- $89-$90 is the next important zone. Green Mountain (GMCR): Tried to make new highs yesterday but came off; need to see if it tries again. Gold SPDR Gold (GLD): Trying to sustain this upper area. It's under the 10-day but trying to hold the 21-day. If GLD gets below $175-$176 it can see a move lower that would probably give more upside to equities. Now is a complicated time for it. Buy above $179.50 for a cash flow tier, and be careful it if breaks $175. Today is Day 3 of the rally from Monday's lows. Don't get overexcited. The market still isn't sure if we can get real traction, but some stocks are definitely doing their own thing. Take profits and keep looking for the right setups.

The Market Continues to Set Up Well

Keep an eye on these stocks for possible entries.

Columnist Conversation

Fibocall: The SPX-Cash Long-Term View

Added Some Apple

Added Some HD, MRTX

COLUMNIST TWEETS

Please Join or Log In to manage and receive alerts.